Republic of Italy (Ministry of Foreign Affairs and International Cooperation - Adelaide Consulate) v Benvenuto

1. The time within which the Applicants may commence an appeal be extended to 18 August 2017. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

WHITE J: 1 I am dealing with two applications for an extension of time in which to appeal to this Court. 2 I have reached the firm view that the extensions of time should be granted for the reasons which follow. 3 The respondents to the two proceedings were formerly employed by the Republic of Italy (the applicant) in its Consulate in Adelaide. Following the cessation of their employment in December 2013, each brought proceedings in the former Industrial Relations Court of South Australia (the IRCSA) seeking payment of wages, long service leave entitlements and superannuation entitlements said not to have been paid by the applicant. 4 The claims for the long service leave entitlements arose under the Long Service Leave Act 1987 (SA). The IRCSA had jurisdiction to hear and determine those claims pursuant to s 14 of the Fair Work Act 1994 (SA). The claims of the respondents to unpaid wage entitlements and superannuation entitlements arose under the Clerks Private Sector Award (the Clerks Award), an award made under the Fair Work Act 2009 (Cth) (the FW Act). I will refer later to the means by which the IRCSA had jurisdiction to hear and determine the claims arising under the Clerks Award. 5 The applicant disputed the respondents' claims and denied that the IRCSA had jurisdiction to hear and determine them. It relied on the provisions of the Foreign States Immunities Act 1985 (Cth) (the Immunities Act). This defence was rejected by an Industrial Magistrate: Miotto & Benvenuto v Republic of Italy [2015] SAIRC 33. 6 The appeals by the applicant against the judgment of the Industrial Magistrate were dismissed by a single Judge of the IRCSA (Judge Hannon) on 23 September 2016: Republic of Italy v Benvenuto [2016] SAIRC 31. The sole ground in each appeal had been the applicant's contention that the effect of the Immunities Act was to deprive the IRCSA of the jurisdiction it would otherwise have had to hear and determine the respondents' claims. The applicant then sought to appeal against the decision of Judge Hannon. It did so by filing a notice of appeal in the IRCSA on 7 October 2016, in the belief that a right of appeal lay to the Full Court of that Court, pursuant to s 188 of the Fair Work Act 1994 (SA). 7 That belief was mistaken because, as will appear, s 565(1B) and (1C) of the FW Act have the effect that an appeal of the present kind lies only to this Court. The mistake went unrecognised until 6 April 2017, when Chief Judge McCusker, in the IRCSA, drew the parties' attention to s 565(1B) and (1C). The IRCSA then vacated the appeal hearing which it had scheduled for 26 April 2017. 8 It seems that the applicant then explored other means of proceeding, including as to whether it would be possible for the Full Bench of the IRCSA to hear and determine the appeals with respect to the claimed long service leave entitlements and whether it could, pursuant to s 563(h) of the FW Act, state a question of law concerning its jurisdiction for the consideration of this Court. It is apparent that the Full Bench had concerns about its jurisdiction as it listed the matter for hearing of that question on 26 July 2017, but that hearing was later vacated. 9 On 4 July 2017, the applicant filed the applications in this Court for an extension of the 21 day period fixed by r 36.03(a) of the Federal Court Rules 2011 (Cth) (the FCR) for the commencement of appeals to this Court. 10 The IRCSA was dissolved with effect from 1 July 2017: s 69(2) of the Statutes Amendment (South Australian Employment Tribunal) Act 2016 (SA). The South Australian Employment Tribunal now has jurisdiction of the general kind previously exercised by the IRCSA, but its jurisdiction does not appear to be co-extensive with that which the IRCSA had. Nevertheless, it is convenient to refer in these reasons to the IRCSA as it was that Court which made the decisions which are in issue. 11 The matters to which the Court generally has regard when asked to exercise its discretion to extend time are the length of the extension sought, the explanation for the appeal not having been commenced in time, the prejudice to the prospective appellant if the extension of time is not granted, the prejudice to the prospective respondent if the extension of time is allowed, the conduct of the parties in the litigation, and the interests of justice more generally. 12 Before addressing those matters, it is appropriate to address a particular submission by the respondents. They submitted that the Full Bench of the IRCSA is, and remains, properly seized of the appeals. In particular, the respondents contended that the Full Bench has jurisdiction "to entertain" at least that part of the appeal which pertains to the long service leave claims because that claim did not involve any exercise of jurisdiction by the IRCSA under the FW Act. The respondents also submitted that this Court does not have jurisdiction with respect to the appeal concerning the long service claims. 13 The assumed correctness of this submission underpinned many of the submissions which the respondents made in opposing the grant of the extensions sought by the applicants. In fact, the respondents conceded, quite fairly, and without prejudice to their submission that the appeals would in any event lack merit, that if this Court does have jurisdiction to hear the appeals to the exclusion of the Full Bench of the IRCSA, it would otherwise be appropriate for the Court to grant the extensions. 14 The submission that the Full Bench of the IRCSA continues to have jurisdiction would appear to face the difficulty that the IRCSA was dissolved with effect from 1 July 2017. However, that difficulty can be put to one side. More generally, the submissions of the respondents concerning the jurisdiction of the Full Bench of the IRCSA and the jurisdiction of this Court require attention to be given to the jurisdiction which was being exercised by the Industrial Magistrate at first instance, and to s 565(1B) and (1C) of the FW Act. 15 I have already noted that in their respective proceedings in the IRCSA, the respondents pursued three claims, being their claims for unpaid wages, long service leave entitlements and superannuation entitlements. 16 Section 545(3) of the FW Act vested jurisdiction in the IRCSA, as an eligible State or Territory Court, to hear and determine the claims to payment due under the Clerks Award. The IRCSA was exercising that jurisdiction in the present cases. That is so even though s 14(a) of the Fair Work Act 1994 (SA) also vested jurisdiction in the IRCSA to hear monetary claims by former employees made under the FW Act and under awards made pursuant to that Act. 17 Section 565(1B) and (1C) provide: (1B) An appeal lies to the Federal Court from a decision of an eligible State or Territory court made on appeal from a decision that: (a) was a decision of that court or another eligible State or Territory court of the same State or Territory; and (b) was made in the exercise of jurisdiction under this Act. (1C) No appeal lies from a decision to which subsection (1B) applies, except an appeal as provided for by that subsection. 18 The effect of s 565(1B) is that an appeal lies to this Court from the decision of Judge Hannon, because that was a decision on appeal from a decision of the IRCSA (constituted by an Industrial Magistrate) made in the exercise of jurisdiction under the FW Act. The fact that the IRCSA was also exercising jurisdiction under the Fair Work Act 1994 (SA) in relation to the long service leave claim does not alter that circumstance. 19 Section 565(1C) has the effect that no appeal lies from a "decision" to which subs (1B) applies (in this case the decision of Judge Hannon) except an appeal to this Court. The term "decision" in this context refers to a judgment or order of a court: Maughan Thiem Auto Sales Pty Ltd v Cooper [2013] FCAFC 145; (2013) 216 FCR 197. 20 The reference in s 565(1B) to a "decision" made in the exercise of jurisdiction under the FW Act is a reference to the primary decision and not to the appeal decision. Accordingly, it is not necessary to consider whether the decision of Judge Hannon in the present cases was also a decision made in the exercise of jurisdiction under the FW Act. 21 In my view, this Court has jurisdiction to hear and determine an appeal in respect of all aspects of the respondents' claims. This must follow because the appeal to this Court lies from the "decision" of Judge Hannon, and s 565(1C) precludes any other appeal. There is no scope for a notion of concurrent exercise of Federal and State jurisdiction in respect of an appeal to which s 565(1B) refers. Subsection (1C) makes that position explicit. Further, it is not sensible to suppose that the legislature contemplated that there may be more than one appeal from a judgment containing decisions on different aspects of a claim. The position is analogous, although not identical with, the jurisdiction of this Court under s 39B(1A)(c) of the Judiciary Act 1903 (Cth) in relation to all aspects of a "matter". See the discussion by Allsop J, as he then was, in the article entitled 'Federal jurisdiction and the jurisdiction of the Federal Court of Australia', (2002) 23 Aust Bar Rev 29, at 35. 22 The respondents advanced an argument to the effect that it was at least arguable that the decision of the IRCSA was not, in the terms of subs (1B), "made in the exercise of jurisdiction" under the FW Act because the real matter in issue before the IRCSA had been the application of the Immunities Act. As I understood the argument, it was to the effect that the IRCSA had been determining a question arising under another Act of the Commonwealth Parliament, rather than exercising a jurisdiction vested in the IRCSA by the FW Act. 23 That submission cannot be accepted. The jurisdiction which the IRCSA was exercising was the jurisdiction to hear and determine the monetary claims brought by the respondents. The fact that the present applicant raised a defence, having its source in some other legislation, does not alter the circumstance that that was the jurisdiction being exercised, any more than would be the case if the present applicant had raised a time limitation defence or some common law defence. The IRCSA had, in the exercise of the jurisdiction vested in it by statute, the ability to decide matters arising incidentally in the exercise of that jurisdiction: Craig v The State of South Australia [1995] HCA 58, (1995) 184 CLR 163 at 179; DJL v The Central Authority [2000] HCA 17, (2000) 201 CLR 226 at [25]. When it did so, it was still exercising the jurisdiction vested in it in relation to the particular claims before it. That is because there is a distinction between the jurisdiction which a court exercises, on the one hand, and the law which the court applies in the exercise of that jurisdiction, on the other. 24 For these reasons, I consider that the submissions of the respondents to the effect that the Full Bench of the IRCSA was, and remains, properly seized of the appeals, that the Full Bench has jurisdiction to hear and determine the appeals, and that this Court does not have jurisdiction to hear and determine the appeals insofar as they concern the claimed long service leave entitlements, must be rejected. 25 Even if my conclusions about the nature of this Court's jurisdiction with respect to the appeals, and the absence of jurisdiction in the Full Bench of the IRCSA, be wrong, I would take the view that the jurisdiction of this Court is sufficiently arguable so that it would be appropriate for the extensions of time to be granted so that the issue as to jurisdiction can, if the parties wish, be ventilated before this Court. 26 Given the respondents' attitude to the grant of the extension of time in the event that the Court concluded that this Court does have jurisdiction to hear and determine all aspects of the appeal, I can deal with the remaining aspects briefly. 27 The periods of extension sought in the present case are significant. The 21 day period fixed by r 36.03(a) of the FCR expired on 14 October 2016, so that the applicant needs extensions of just on nine months. However, the applicant has, in my opinion, provided a satisfactory explanation for the delays, namely, that it had, on legal advice, incorrectly believed that its appeals lay to the Full Bench of the IRCSA, and it had commenced appeals in purported pursuance of that right. Until 6 April 2017, the applicant was expecting that its appeals would be heard by the Full Bench of the IRCSA on 26 April 2017. The time which has elapsed since 6 April 2017 has also been explained satisfactorily by reason of the attempts made by the applicant, in which it seems the respondents have participated, to pursue alternative courses in the IRCSA. 28 In my opinion, the oversight of the applicant's legal advisors is understandable even if, strictly speaking, it should not have occurred. The applicant will suffer prejudice if the extensions are refused. It will, in that circumstance, have lost the ability to appeal. Of course, the loss of the right to appeal would not be productive of prejudice if it could be said now that the appeals are doomed to fail. I do not think that the Court should form that view presently. 29 The issue which the applicant wishes to agitate on appeal is the proper construction and application of s 12(4)(b) of the Immunities Act. That issue arises in the following way. Section 9 of the Immunities Act provides for the immunity of a foreign state from the jurisdiction of Australian courts. However, s 12(1) of the Immunities Act provides an exception in relation to proceedings which concern the employment of a person under a contract of employment made in Australia, or which is to be performed wholly, or partly, in Australia. 30 Prima facie, s 12(1) applies in the case of the claims by the respondents. However, s 12(4) of the Immunities Act provides, relevantly, for circumstances in which the immunity of a foreign state does apply to proceedings which would otherwise come within s 12(1). Paraphrasing the position, the immunity of a foreign state is preserved under s 12(4) if two conditions are satisfied, namely, the Court finds that an inconsistent provision is included in the contract of employment (subs (4)(a)), and a law of Australia does not avoid the operation of, or prohibit or render unlawful, the inclusion of the provision (subs (4)(b)). 31 In the present case, Judge Hannon found that the s 12(4)(a) condition was satisfied but that the subs (4)(b) condition was not. The applicant wishes to challenge that finding by, amongst other things, contending that the construction of s 12(4)(b) adopted by the IRCSA is wrong. 32 Given the nature of the issue, I consider that is not desirable presently to descend into a detailed consideration of the merit of the applicant's proposed arguments. It is sufficient to indicate that the construction of s 12(4)(b) for which the applicant wishes to contend does not appear to be unarguable. 33 The respondents will suffer prejudice if the extensions of time are granted, arising from the delay which will occur before their claims to the monetary entitlements are finally determined. That is a consideration which points against the grant of the extensions. 34 As to the remaining considerations, I take into account that the proper construction of s 12(4) of the Immunities Act has not previously been considered by a superior court, and also that the respondents themselves had made the same mistake as to the jurisdiction of the IRCSA as did the applicant. They had raised no objection to the Full Bench of the IRCSA proceeding with the appeal. Had they done so, it is probable that the applicant would have adopted its present course of action much earlier than it did. 35 I am satisfied that, while the length of the extension sought is significant, and while there may be some prejudice to the respondents from the grant of the extensions, the explanation for the matters being out of time, taken together with the significance of the matters which the applicant wishes to agitate on the appeals, point strongly in favour of the grant of the extensions. Accordingly, I will make an order extending the time within which the applicant may commence an appeal in each of the two actions to 18 August 2017. I certify that the preceding thirty-five (35) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice White.